ISO Standards Revisions; Competitive Advantage or Business as Usual?

The planned revisions now moving to the final stages of development for the Quality Management System (QMS) Standard ISO 9001 and Environmental Management System (EMS) Standard ISO 14001 are leading to a watershed moment for companies around the world. Organisations will have to make a choice. On one hand, they can carry on with the tactical management of ISO standards as a ‘means to an end’ – viewing certification as ‘tick in the box’ exercises that result in a piece of paper on the wall thereby allowing them to tender for business with large organisations. Alternatively, companies could use the revisions as a catalyst for organisational change and make a fundamental shift to strategically managing their business through an integrated, robust, independently certified management system.

The update to ISO 9001, the most widely adopted of all management system standards (MSS), with over one million certified organisations relying on it globally to run their businesses, is the one that has gathered the most interest from stakeholder groups. The update, often referred to as ISO 9001:2015, is of particular interest for the world’s more mature economic markets, mostly those in Western Europe, as it represents the first significant change to the standard since the 2000 update, which embedded continual improvement into the standard. For developing markets around the world, in particular in Asia, ISO 9001:2015 is likely to fuel further growth of MSS, with organisations needing to demonstrate core competencies and adherence to global standards as a pre-requisite, a so-called ‘license to export’.

ISO 14001 has a smaller client base, with companies having a certified EMS for a variety of reasons, including 1) to gain competitive advantage through the demonstration of a plan to limit their environmental impact, 2) to reduce raw material energy and waste costs through better identification and management of those areas of the business, 3) it is required by large clients in order to tender for business and 4) it is required for compliance with regulatory requirement.

As each ISO or ISO-based management system standard goes through its review process (normally every five years), they will all be adopting Annex SL and its common elements into the next update. Annex SL defines the framework for generic MSS so as to ensure that the text used is aligned to the extent that they have, where practical, identical clause titles, sequence of clauses, definitions and as much identical text as feasible.

“Theoretically, by 2018 at the latest, the majority of management system standards should be aligned through the incorporation of Annex SL,” said Steve Williams, Deputy Technical Director at assurance provider LRQA. “The potential benefits that Annex SL could bring to companies interested in getting their existing systems to ’talk to each other’, as well as those companies looking to bring new management systems into their existing ones are already being discussed by interested parties of management systems around the world.”

The current planned schedule for ISO 9001:2015 is for a May 2014 DIS, a July 2015 Final DIS (following another round of comments on the DIS) and finally the publication of ISO 9001:2015 is scheduled for September 2015. For ISO 14001:2015, the timescales are for a July/August 2014 DIS (dependent on the outcomes of the TC207/SC1 WG5, the ISO technical committee responsible for the update), followed by a March/April 2015 Final DIS all leading to a May/June 2015 final publication.

Back to the title of this article, the decision that companies will be facing in the very near future; to continue to manage their MSS certifications as ’what the quality and environmental managers do’ or to embrace the changes in ISO 9001 and ISO 14001 and make management systems a strategic tool that helps improve performance and reduce risk.

The two significant additions to ISO 9001 and 14001 that will make it possible are; 1) the inclusion of a formal link between an organisation’s strategy and its’ QMS or EMS, and 2) the requirement of a demonstrable management of risk within the standard, both underpinned with greater senior management engagement, Naturally, there will be a need for companies to dedicate resources and focus to bringing their existing ISO 9001 and ISO 14001 in line with the new requirements. That fact alone will ensure that the full transition of companies to the updated ISO 9001 and 14001 standards will go into 2018 at least. Therein lies the opportunity for competitive advantage for companies.

Those companies that will lead the way will embrace the changes to ISO 9001 and ISO 14001 and will not be waiting for the late 2015 official release of the standards. They will begin their transition in the second half of 2014, starting with training of their internal audit teams and of their employees involved in management systems on the new standards. They will follow that up with a gap analysis as soon as the Draft International Standard (DIS) and Final DIS (FDIS) are issued, which could be as early as the end of this year. Most importantly, the decision to upgrade and include the new requirements as soon as possible will be driven at a board level by senior management, as the potential value of tying embedded systems and processes to the management of risk will be identified at a strategic and operational level.

Inevitably, as management systems assume a more strategic role within companies, the value and importance of robust, relevant assessment will also be seen as a vital part of getting the most out of those systems. So, what does that mean in real terms; increased assessment costs, a rise in the number of companies unable to pass the assessment and therefore, not obtaining an ISO 9001 certificate? We don’t believe so.

In relation to the first fear, increased assessment costs; a more likely scenario is increased efficiencies across the business as more robust systems highlight potential areas for improvement, bring about better management of risk and a stronger focus on continuous improvement. The savings from those three areas alone will far outweigh any additional cost of assessor time or employee training.

As far as fewer certificates being issued, again we have a different take on that. In the beginning, as organisations and their systems transition to a more strategic emphasis on management systems, there is likely to be an increase in non-conformities that are raised. But the closing off of those non-conformities will result in a stronger, more effective and efficient management system. Ultimately, that will lead to a situation where the piece of paper on the wall is but a small part of the overall benefit that an independently certified management system will deliver to the stakeholders of the organisation.

A road map for the early adopters of the new ISO 9001 and ISO 14001 standards would include the following steps:

Investigate
Find out about the new standards, including what the proposed changes are and the dates that are being discussed for the development of both standards.
Choose
Select a provider of assessment, certification and training services who is actively involved in the development of both standards. They will be able to provide insight and expertise that will help get your organisation on the path to making a successful transition.
Train
Train your people - both your internal audit team and those responsible for the development, implementation and maintenance of management systems in your company.
Engage
Include senior management in that training so they fully understand the potential value of the changes contained with the new standards updates.
Learn
Purchase the DIS and FDIS as soon as they are available, beginning the process of ensuring that all relevant employees within your organisation have the documentation to support the training course.
Plan
Have an independent assurance provider come in and conduct a thorough gap analysis to help your business understand what needs to be done to make a smooth and beneficial transition to the new standards.
Transition
Buy the new standards as soon as they come out and lead your industry in making the transition.
Communicate
Shout about it to your interested parties - both internal and external. They will appreciate your vision and commitment to an efficient and sustainable business, as will the new clients that the transition will help your business secure.

To conclude, as the new standards begin to get closer to their release date, companies are at a crossroads. As Steve Williams summarised; “The decisions that organisations make in relation to their management systems will have a profound effect on their ability to compete, successfully manage risk, deliver on the expectations of their interested parties, and ultimately to run a sustainable business. At LRQA, we believe the choice is clear. “

News

Achieving certification to some of the world’s most widely-recognised international management system standards requires strategic planning, a strong internal team effort, coupled with a close working relationship with an independent and recognised provider of professional assurance services such as LRQA. These are just some of our clients whose achievements headlined last week.

Speaking at a conference in London organised by the International Organization for Standardization (ISO) recently, Marcus Long, CEO of the Independent International Organisation for Certification (IIOC), demonstrated the tangible benefits of accredited certification to ISO standards on organisations, and relatedly the impact this has on insurers.

Following an extensive audit by the United Kingdom Accreditation Service (UKAS), LRQA has been granted accreditation to ISO 13485:2016, the international quality management system (QMS) standard for organisations involved in medical device manufacturing.

Following a week of meetings in June 2016, during which ISO 45001 - the new occupational health and safety standard being developed by the International Organization for Standardization (ISO) - moved to a second draft international standard (DIS2) stage, ISO/PC 283/WG1, the Working Group responsible for developing the new standard, met three weeks ago in Lithuania.

→Contact us

If you would like to speak to someone at Lloyd's Register then please call your local office on the number below. Alternatively, if you have an enquiry you can fill out the form opposite.

Local Office Details

Lloyd's Register, LR and any variants are trading names of Lloyd's Register Group Limited, its subsidiaries and affiliates. Lloyd's Register Group Services Limited (Reg. no. 6193893) is a limited company registered in England and Wales. Registered office: 71 Fenchurch Street, London, EC3M 4BS, UK. A member of the Lloyd's Register group.